The skin has served as an extremely useful model for studying factors regulating normal epithelial growth and development and the perturbation of these processes that occurs during neoplasia. Although much previous work has centered on squamous cell carcinoma, there has been increased interest in basal cell carcinoma (BCC) following the discovery that deregulated Sonic hedgehog (Shh) signaling is linked to the development of these tumors. Shh pathway activation may be the result of loss-of- function mutations (involving the Shh receptor PTCH1), or gain- of-function mutations (involving SMO, which is normally repressed by PTCH1). While uncontrolled Shh pathway activation is associated with tumor development, we and others have shown that targeted disruption of Shh results in severe impairment of hair follicle morphogenesis. Although it is clear that Shh signaling has important functions in normal skin and BCC, the pivotal nuclear target(s) mediating keratinocyte responses to this pathway have yet to be identified. Much of what is known about this pathway is based on genetic analysis in Drosophila, where the transcription factor Cubitus interruptus (Ci) mediates responses to the Shh homolog Hedgehog. We will explore the notion that one or more of the vertebrate Ci homologs (Gli1, Gli2, Gli3) plays a central role in Shh signaling in keratinocytes. We propose a series of comprehensive studies focusing on the biological, biochemical, and molecular consequences of Gli protein overexpression in keratinocytes. Although there is substantial evidence implicating deregulated Shh signaling in BCC, there is little insight into how activation of this pathway leads to tumor formation. The results of the proposed studies will provide new information to fill in this gap in our knowledge. In addition to BCCs, several other neoplasms have been linked to the Shh pathway, including medulloblastomas and rhabdomyosarcomas. Moreover, precisely-controlled Shh signaling is essential for embryonic patterning in multiple tissues, with deregulation of this pathway leading to a variety of developmental abnormalities. Thus, the knowledge gained during the course of the proposed studies is likely to have relevance to a variety of clinical disorders, and may ultimately lead to improved treatments for BCC and other tumors.